Know Your Insurers-
Page 75
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CASES of driving or permitting a vehicle to be used on the road while uninsured for third-party risks would seem—morally at least—to fall into two sharply defined categories. No one should have the least sympathy for a driver or employer who uses a vehicle in deliberate defiance of the law and in the certain knowledge that its use—either generally or in a particular way—is not properly covered by insurance.
On the other hand, it is not difficult to imagine circumstances when either through genuine inadvertence or an understandable failure to appreciate a legal point of insurance of some nicety the moral blame attaching to the culprit must be minimal
How far do these circumstances affect one's legal, as opposed to one's .moral, obligations? And how far, if at all, can one either be assisted by, or damned by, the attitude and standing of the insurers themselves?
It must first be realized that a breach of section 35 of the Road Traffic Act 1930, which creates the offences of using, or causing or permitting the use of a vehicle uninsured, is an " absolute " offence, i.e., the mere act is sufficient and it requires no kind of guilty knowledge to " complete the offence. It should be pointed out, however, that as regards employees, this has now been mitigated by section 29 of the Road Traffic Act 1956, which provides that if the defendant were using the vehicle in the course of his employment and neither knew nor had reason to .believe it was uninsured a conviction cannot be registered against him.
. Secondly, it must be remembered that insurers are businessmen and not philanthropists, and it is in their interests to ensure that all the risks—both likely and unlikely—which would cause them to charge an increased premium to the one in fact charged, should be carefully excluded. Accordingly, all policies are greatly hedgeld about with exceptions by which the insurers seek to limit their liability.
Deliberately Excluded Certain exceptions which would otherwise affect the necessary legal third-party cover are deliberately excluded by statute. Thus, by section 38 of the 1930 Act, a condition in a Policy that liability shall be limited because of something done or omitted after the event giving rise to a claim is void, and certain other attempts to restrict liability by reference to various matters are expressly rendered void by section 12 of the 1934 Act. It is unnecessary to list these here.
What frequently happens in this imperfect world of ours is that, however carefully drawn a policy may be in its exemption clauses, a situation will arise which is not specifically provided for and which cannot fit easily into the strict wording of the clauses.
In other words it is ripe matter for a dispute as to interpretation—whether the particular risk was covered or not. This is perhaps fair enough—and good hunting for the lawyers—when all that is involved is a civil action, but what is the position when the point at issue is directly relevant to a prosecution of which the result may be a heavy fine and possible disqualification?
It is a strange anomaly of our legal system that in such cases the tricky point of law involved must be decided by a court, the most inferior in status—i.e., a magistrates' court—when the question of construction of the policy may be sufficient to baffle judges up to and including the Court of Appeal! It is in those circumstances that the attitude of the insurers themselves may be Vital.
Where the interpretation of the policy is a moot question, if the insurers give evidence that they would consider themselves liable on it in the circumstances disclosed by the prosecution, then it is only reasonable for the magistrates to hold that no offence has been committed; although they are not botmd to take this view, in practice they generally do. ,
Apart from the evidence of the insurers, it is a rule of interpretation of legal documents that where there is ambiguity the document is to be constructed contra proferentern, i.e., against the party relying on the exemption, in other words, the insurers.
On the other hand, the fact that the insurers, on a mistaken view of the meaning of the policy, think that they are "on risk" is no answer to a charge if the risk is clearly not covered.
Attitude Important , Often a driver who has forgotten to renew his licence may become uninsured if his policy excludes liability for drivers not in possession of a current licence. Where this is an obvious slip and the insured is considered a good risk the insurers—or rather• good insurers—will readily say that they would have regarded themselves as being on risk even though they might have avoided liability. Evidence of this nature will tend to minimise the offence in the court's eyes but cannot entirely exculpate the offender.
It should be clear enough that the attitude of one's insurers may be very important, and this is not confined to their readiness to meet claims on them, In The Commercial Motor of April 11, there was reported an " unusual " clause in a policy disclosed in the course of a prosecution which operated very much in the defendant's favour.
The usual exemption clause in respect of persons not licensed to drive was mitigated by a proviso that the policy was still valid if it was not within the insurer's knowledge that the driver was not licensed. This was a gratifying example of a generous attitude by insurers.
On the other hand, one of the biggest companies with a huge motor insurance business, think nothing of taking payment for six months' or a year's insurance at the time of the proposal, issuing a 15-day cover note and then notifying the proposer many weeks later that the proposal is refused, returning the unexpended part of the premium. Meanwhile, the unfortunate proposer believing himself covered— because he has paid for six months in his opinion—may be held to be uninsured after the expiry of the cover note.
The moral here seems to be: know your insurers. Just as they are entitled to trust your proposal, so you may expect to receive honourable and sympathetic, rather than sharp, treatment. You choose your doctor with care; do the same with your insurers In any event, if in doubt about whether your policy covers a particular use—ring them up and ask them.